12170-12200 IS THE RESISTANCE ZONE; 12024 IMMEDIATE SUPPORT

12170-12200 IS THE RESISTANCE ZONE; 12024 IMMEDIATE SUPPORT

WORLD MARKETS

US indices ended little changed after the Federal Reserve kept interest rates steady and struck an upbeat tone on the health of the U.S. economy.

Fed held the overnight benchmark rate in a range between 1.5% and 1.75%, as expected. In a statement, it said the direction of rate policy is predicated on whether inflation can return to their 2% objective. The central bank also remarked the labor market remains “strong” while the economy is growing at a “moderate rate.”

The benchmark 10-year Treasury yield fell to 1.59%, lifting bond prices. The 2-year rate slipped to 1.42%.

Apple gained 2.1% to hit a record after its quarterly results easily beat expectations. McDonald’s, Dow Inc, ADP and General Electric also reported profits that beat estimates. AMD shares, however, dropped 6% after the semiconductor company issued weaker-than-forecast revenue guidance for the first quarter.

Brent crude gained 30 cents to settle at $59.81 per barrel while WTI crude slid 15 cents, or 0.3%, to settle at $53.33 per barrel.

European markets ended with gains of upto 0.7%. Morale among Italian manufacturers climbed from 99.3 in December to 99.9 in January while consumer confidence rose to 111.8 from 110.8 in December, surpassing expectations. French consumer confidence index rose from 102 in December to 104, having been expected to remain flat.

AT HOME

Benchmark indices rose six tenth of a percent, snapping two-day losing streak and recouping all the losses made yesterday. Sensex settled at 41198, up 231 points while Nifty added 73 points to finish at 12129. BSE mid-cap and small-cap indices rose 0.5% and 0.1% respectively. Except 0.5% lower Consumer Durables index, all the BSE sectoal indices ended in green with FMCG and Industrials indices leading the tally, up 1.4% and 1.2% respectively.

FIIs net sold stocks worth Rs 1014 cr but net bought index futures and stock futures worth Rs 440 cr and 891 cr respectively. DIIs were net buyers to the tune of Rs 1521 cr.

Rupee appreciated 7 paise to end at 71.25/$.

Bajaj Finance reported better-than-expected quarterly numbers with largely stable asset quality. NII rose 42% y-o-y to Rs 4537 cr and Net profit surged 52% to Rs 1614 cr. Gross NPA ratio remained unchanged q-o-q at 1.61% while net NPA ratio rose 5 bps to 0.70%. Slippages rose to Rs 936 cr from Rs 786 cr. Assets Under Management rose 35% y-o-y to Rs 1.45 lakh cr.

OUTLOOK

Shanghai continues to remain shut while Nikkei and Hang Seng are trading with cuts of 0.9% and 0.2% in today's trade. SGX Nifty is suggesting a flattish start for our market.

In yesterday's report we had said that 12000 continued to be important support while immediate hurdle on the hourly chart was placed around 12165.

Nifty, after touching a high of 12170, eased to close at 12130.

12170, the top made yesterday, also coincides with a trendline resistance adjoining recent tops on the daily chart. Moreover, 20 and 34 DMAs are placed at 12190 and 12200 respectively, making 12170-12200 important resistance zone, a crossover of which is required for a fresh upmove. If that happens, 12300 and 12430 would be next upside targets to eye.

12024, the low made Tuesday, is the immediate support, below which, 20-week moving average, placed around 11900, would be the next support.

Bajaj Auto, Tata Motors, Colgate, Dabur, IOC and Bharti Infratel will report their quarterly earnings today.